Overall value of Australian residential construction work fell 2.5% in quarter ended in December 2013; improved activity levels seen to-date driven almost entirely by multi-unit building segment: says Housing Industry Assn.
February 26, 2014
– Preliminary ABS figures released today indicate that the recovery in residential construction activity took a backwards step in the December quarter of 2013, said the Housing Industry Association, the voice of Australia’s residential building industry.
“The overall value of residential construction work done on new dwellings declined by 2.5 per cent in the final quarter of 2013. We are seeing good things across a number of leading indicators, but today’s data reaffirms our view that the speed and strength of the recovery in residential building has been overstated in some forums,” said HIA Economist, Geordan Murray.
“The improved levels of activity we have seen to date have been driven almost entirely by the multi-unit segment. While this is an increasingly significant component of the housing mix, a true recovery in new home building requires a consistent and aligned increase in detached homes as well as multi-units,” said Geordan Murray.
“Clearly, the need for policy reform to support housing supply remains a priority if housing is to make theexpected contribution to economic growth,” added Geordan Murray.
The value of work done on new detached homes declined by 0.9 per cent in the December quarter of 2013 to a level that is 5.1 per cent below that of a year earlier. The value of work done on multi-unit construction declined by 4.9 per cent in the December quarter of 2013 although remained 5.9 per cent above the level recorded in the December quarter of 2012.
“On a more positive note, it is encouraging to see some improvement in the renovations sector. Activity in this part of the market had dropped to a decade low in the middle of 2012. It appears that low interest rates and rising home prices are providing a much needed boost to demand in this segment” added Geordan Murray.
The value of work done on renovations increased by 3.2 per cent during the quarter but remains 0.4 per cent below the level recorded in the corresponding period last year.
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